Published on January 13, 2006

Government revenue in the first quarter of the 2006 fiscal year was Bt3.7 billion above target, according to the Finance Ministry.

In the October-December quarter, revenue topped Bt270.6 billion, up 1.4 per cent from the same period last year.

Somchai Sajjapong, deputy director-general of the Fiscal Policy Office who was commenting as the ministry’s spokesman, attributed the increase to higher-than-expected tax collection from the Revenue Department. It was 10.3 per cent above target and 14.9 per cent up from last year’s harvest.

“From the record as well as the expected economic growth of 5.5 per cent this year, the ministry is confident that government revenue in the 2006 fiscal year should meet the target of Bt1.36 trillion,” he said.

Somchai said that in December alone government revenue had reached Bt87.36 billion, Bt634 million above target. Value-added tax collection and income taxes expanded 14.6 and 13.1 per cent, respectively, from the same month last year.

The government expects to run another balanced budget in fiscal 2006.

It is also determined to seek a balanced budget in 2007, while tentatively setting government spending at around Bt1.4 trillion. The expectation comes amid fears that economic conditions might not be as rosy as expected, given high inflation and shaky demand in export markets. Several finance houses have anticipated that average crude oil prices this year will be higher than last year, which, coupled with higher interest rates, could increase inflation.

Inflation is forecast to remain at 4.5 per cent, the same level as recorded last year.

On Wednesday, Prime Minister Thaksin Shinawatra revealed a set of policies designed to assure businessmen of economic prosperity. He expressed confidence that gross domestic product would expand by at least 5 per cent this year.

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